3 UK and T-Mobile shared 3G network to be managed by Ericsson

Cutting costs using a managed services deal is the primary aim of the joint venture between two mobile operators called MBNL and the opinion of analysts is that there will be more outsourcing deals and network sharing within mobile space.

A deal with 3 UK and T-Mobile Broadband to manage the shared 3G network of the mobile operators’ for the next four years was recently announced by Ericsson.

January saw the formation of a 50:50 joint venture between the two mobile broadband providers called the Mobile Broadband Network Limited (MBNL), which aimed to save £2 billion over a 10 year period by combining the two 3G networks.
The managing director of Ericsson UK, Mats Granryd said “This agreement is an interesting proof point for the success of managed mobile network services as a concept.”

While a number of contracts had been won by Ericsson’s managed services division, which including four individual operator deals in India, the recent award for a shared network is a first for the company.

During the consolidation of the two networks both the 3G infrastructure of the two parent companies and T-Mobile’s 2G RAN will be managed in terms of both performance and operation under the terms of the MBNL agreement. Ericsson will also be working with a number of vendors who are currently involved in the project due to 3 and T-Mobile’s network consisting of a variety of product from other equipment makers.

The vice president of technology and service provider research at Gartner, Martin Gutberlet said “From an economical point of view T-Mobile and 3 UK want to make the cost of delivery for 3G services cheaper – that was the motivation for sharing their networks. So they formed MBNL, but it’s not in their interest to manage this company, so they outsourced the project to Ericsson,” he commented.

The deal with Ericsson will significantly increase any operational savings that 3 Broadband and T-Mobile had hoped to achieve with their agreement to network share, said Gutberlet.
He said “They’ve outsourced the management to a single party which saves on opex, so the Ericsson deal makes sense.”

The help Ericsson manage the network better 80 employees of T-Mobile will be transferred across said Ericsson’s Granryd.

CTO at 3 UK, Graham Baxter said “The deployment of our consolidated mobile broadband network is advancing rapidly.”

The beginning of February 2008 saw the commissioning of the first of Ericsson’s integrated cell sites with the Bradford and Leeds area being the first to complete an MBNL pilot scheme. On top of this, a backhaul deal with BT 21CN was signed in October which saw high-speed Ethernet lines interconnecting 7 500 of its base stations.